3 Exercise 16-3 (Algo) Financial Ratios for Asset Management (L016-3] Comparative financial statements for Weller Corporation, a merchandising company, for the year ending December 31 appear below. The company did not Issue any new common stock during the year. A total of 600,000 shares of common stock were outstanding. The Interest rate on the bond payable was 10%, the income tax rate was 40%, and the dividend per share of common stock was $0.75 last year and $0.40 this year. The market value of the company's common stock at the end of this year was $26. All of the company's sales are on account. 0.8 points Skipped Weller Corporation Comparative Balance Sheet (dollars in thousands) This Year Last Year eBook $ 1,200 9,300 13,900 710 25, 110 r References $ 1,270 8,000 10,900 520 20,690 9,300 49,840 59,140 $84,250 9,300 39,896 49,196 $69,886 Assets Current assets: Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Property and equipment: Land Buildings and equipment, net Total property and equipment Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Accrued liabilities Notes payable, short term Total current liabilities Long-term liabilities: Bonds payable Total liabilities Stockholders' equity: Common stock Additional paid-in capital Total paid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $18,600 990 160 19,750 $18,000 870 160 19,030 9,400 29,150 9,400 28,430 **** 600 600 4,000 4,600 50, 500 55,100 $84,250 4,099 4,600 36,856 41,456 $69,886 3 0.8 points Weller Corporation Comparative Income Statement and Reconciliation (dollars in thousands) This Year Last Year Sales $79,580 $64,000 Cost of goods sold 37,200 36,000 Gross margin 42,380 28,000 Selling and administrative expenses: Selling expenses 11,500 10,500 Administrative expenses 6,800 6,700 Total selling and administrative expenses 18,300 17,200 Net operating income 24,080 10,800 Interest expense 940 940 Net income before taxes 23,140 9,860 Income taxes 9,256 3,944 Net income 13,884 5,916 Dividends to common stockholders 240 600 Net income added to retained earnings 13,644 5,316 Beginning retained earnings 36,856 31,540 Ending retained earnings $50,500 $36,856 Skipped eBook References Required: Compute the following financial data for this year: 1. Accounts receivable turnover. (Assume that all sales are on account.) (Round your answer to 2 decimal places.) 2. Average collection period. (Use 365 days in a year. Round your Intermediate calculations and final answer to 2 decimal places.) 3. Inventory turnover. (Round your answer to 2 decimal places.) 4. Average sale period. (Use 365 days in a year. Round your Intermediate calculations and final answer to 2 decimal places.) 5. Operating cycle. (Round your Intermediate calculations and final answer to 2 decimal places.) 6. Total asset turnover. (Round your answer to 2 decimal places.) days 1. Accounts receivable turnover 2 Average collection period 3. Inventory turnover 4. Average sale period 5. Operating cycle 6. Total asset turnover days days